SA Eli Hoffmann / Profile - Comments / Seeking Alpha

Hi everyone,

This is what I posted recently on Chuck's post about this question. P.S. Chuck and I are ironing out plans to meet in-person (for the first time!) soon.

This is clearly a topic that many dedicated SA users feel passionate about. And with good reason. @Chuck Carnevale has been a pillar of value for our readers for years, and I am grateful for everything he's done for Seeking Alpha and for our community.

@Chuck Carnevale I would be glad to talk by phone this week, or even to fly out for a game of golf and dinner on me. If for no other reason, it would be an honor to finally meet in person.

I discussed @David Jackson's decision with him at length, and I support it, even as I acknowledge that there are negative aspects to it.

Here's why I support his decision:

As a content publisher, we publish (simplistically) two kinds of articles:

1. Non-promoted content. We don't charge contributors to post non-promoted content, and in fact try to compensate them in numerous ways: distribution, exposure, discussion, and cash payments.

2. Promoted content. We don't do a lot of this (see more below), but we do so to pay bills. Promoted content, such as content from advertisers that promotes their brokerage services, portfolio or wealth management services, etc., is a paid service. Advertisers pay publishers like Seeking Alpha in order to reach their audience. This is common in many industries.

Promoted content is sold via our media sales team. For example, on Friday I noticed that CapIQ S&P was running a promoted campaign to promote its indexes across desktop and mobile. To be clear: their content is quality content. Nonetheless, the commercial nature of our relationship with companies looking to sell a service is such that we charge them to get distribution to our audience. This is standard practice. Companies are also free to publish non-paid non-promoted content on Seeking Alpha, as long as it remains free of explicit references to its commercial interests. They get an author profile that links to their paid service, but not the ability to market within the content. That's why you see many high-quality asset managers that publish both free content on SA (devoid of any commercial links etc.) and paid content (with marketing materials, links, etc.).

With regard to our Marketplace authors, whose content contains explicit end-of-article marketing, this too is a commercial interest. We partner with Marketplace authors, and take a share of their revenue (we take 25%, they take 75%). In exchange for that, we allow them to utilize the end-of-article unit to promote their service. (We also do other things such as paid acquisition on 3rd party platforms like Facebook and Google.) Our policy is to restrict their Marketplace marketing to the end of the article; if you feel we are failing in that, please let us know. I am proud of our Marketplace: By the end of this year, Marketplace authors will be earning more than $7.5M/year by sharing their research with SA readers. That is a victory for independent investment research!

With regard to FastGraphs, I am a fan. While not a subscriber, it appears to be a great tool that is subscribed to by many SA users, and others. Likely, many subscribers discovered FastGraphs via Chuck's Seeking Alpha articles. And I have no regret about that.

However, in looking at the consistency of our policies, we felt that allowing some contributors to in-article market their services and others not to was unfair, inconsistent, and bad business practice. As an analogy, while Amazon might do a great public service by allowing non-Amazon sellers to market their quality wares on Amazon, no one would reasonably expect them to do so for free.

So back to the golf and dinner, perhaps we can come up with commercially beneficial terms, or perhaps Chuck can continue to publishing without the in-article marketing, or perhaps neither, and we can just share a good 18 holes and some beer. (Chuck, do you golf?)